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These fish can be found on the Halo 3 level Sierra 117, at the chapter Charlie Foxtrot, where the Pelicans are attacked by Covenant Loyalist Banshees. You can also see them on your radar at the main dam (Rally Point Bravo). If a player jumps in the water, that person may walk around and see them. They will appear as small yellow dots on your radar screen, similar to allies but smaller.
It is possible to kill them; if you do, they float to the surface and then drift to shore before eventually respawning. Throwing a grenade in the water will result in the whole "school" of them dying and floating to the surface.
The Sierra 117 fish are used by some players as a method of sport known as "fishing". The players will attempt to kill as many fish as possible, at times even turning on the Fog Skull to avoid the fish showing up on radar and making the sport more difficult.
The fish is a real species of the Malawi lake called Dimidiochromis, and is a cichlid.